Atlantic Soup Company is presently operating at 75 percent of capacity. Worried about the company's performance, the president is considering dropping its clam chowder line. If clam chowder is dropped, the revenue associated with it would be lost and the related variable costs saved. In addition, the company's total fixed costs would be reduced by 15 percent.

Segmented income statements appear as follows:

Product	Tomato			Clam Chowder			Chicken Noodle
Sales	$	32,600		$	42,800		$	51,200
Variable costs		22,000			38,600			40,100
Contribution margin	$	10,600		$	4,200		$	11,100
Fixed costs allocated to each product line		4,700			6,000			7,100
Operating profit (loss)	$	5,900		$	(1,800	)	$	4,000

Required:

(a)	Prepare a differential cost schedule. (Costs and their differences should be indicated with a minus sign. Omit the "$" sign in your response.)

	Status Quo	Alternative: Drop Clam Chowder	Difference
Revenue	$	$	$
Less Variable Costs
Contribution Margin	$	$	$
Less Fixed Costs
Operating profit (loss)	$	$	$

(b)	Indicate whether Atlantic should drop the clam chowder product line.